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Political operative G. Steven Pigeon looks on during proceedings in State Supreme Court in Buffalo on Wednesday, April 19, 2017, where new charges of felony election law violations were lodged against him and two of his associates. (Derek Gee/Buffalo News)

Latest Pigeon charges involve donation to Cuomo's 2014 campaign

G. Steven Pigeon stood before a judge Monday for the third time in the last 10 months, this time to face a federal complaint that his controversial fundraising activities extended all the way to the 2014 re-election campaign of Gov. Andrew M. Cuomo.

In a session before U.S. Magistrate Judge Michael J. Roemer, a newly unsealed FBI complaint alleges the well-connected political operative conspired to solicit a $25,000 contribution to the Cuomo campaign from a Montreal-based internet gambling company for whom his Papi Holdings LLC earned $388,000 in lobbying fees from 2010 to 2015.

The federal complaint, based on emails seized from Pigeon's waterfront condo during a 2015 raid, alleges he conspired to hide the true source of the foreign contribution while arranging it for a Manhattan event featuring the governor. He could face five years in jail if convicted.

“Pigeon sought and successfully helped ... a $388,000 client,” acting U.S. Attorney J.P. Kennedy said during an afternoon press conference, “allowing them to interfere in a U.S. election by making a significant contribution.

“The investigation is ongoing,” he added. “At this point, the only person identified is Mr. Pigeon.”

The complaint adds that Pigeon, two others anonymously listed in the papers “and possibly others,” conspired to make the donation. Adam S. Cohen, special agent in charge of the Buffalo FBI, added that his investigators are continuing to work on the case.

“The FBI believes firmly these individuals should not have the ability to unduly or illegally influence elections in the United States,” he said.

Pigeon, the former Erie County Democratic Committee chairman with long ties to Cuomo, vehemently denied the charges in an interview with The Buffalo News outside the courtroom. He again claimed he is the victim of a “political witch hunt.”

He said that in conjunction with two separate felony cases filed earlier by state Attorney General Eric T. Schneiderman, “prosecutorial misconduct” lies behind the new charges.

“These latest ridiculous charges – three in a row now – show what a political witch hunt this is,” he said. “I was simply a co-host of a Cuomo party and invited a Canadian citizen to an event like what he attends all over the United States. I simply invited a person and I’m the only one charged.”

Prosecutors 'piling on'

Pigeon said a Florida attorney made the contribution on behalf of the Canadian citizen in accordance with all election laws. He again singled out Schneiderman, who lodged two separate felony cases involving bribery, extortion and election law violations last June and in April of this year.

“This is all the result of a politically motivated prosecutor and an obsessed federal agent on this case,” he said, calling the attorney general “the most political prosecutor in the history of this state.”

“I have no idea why these people are piling on,” he said, adding that millions of dollars have been spent to put him under a “microscope.”

Pigeon attorney Paul J. Cambria Jr. also insisted that Pigeon’s involvement in the Cuomo contribution followed all legal requirements. He said all of the allegations filed Monday were known by Cuomo campaign officials and that he has no idea why Pigeon has been singled out.

“The Cuomo people were aware of it,” he said, adding that his client is convinced of the political motivations, “at least from the state standpoint.”

“If somebody claims that contribution was illegal, there are real questions about that,” Cambria said, adding his investigation indicates the alleged contribution was legally made by a Florida attorney on behalf of the Canadian businessman.

Cuomo’s office referred inquiries about the Pigeon connection to the state Democratic party. Basil A. Smikle Jr., the party's executive director, did not return a call seeking comment, but issued this statement: "As is made clear in public record, the campaign rejected donations we believed to be out of compliance with campaign finance laws. We are assisting in this inquiry in any way that we can."

The federal complaint indicates the campaign on several occasions insisted on following proper procedures.

The federal complaint submitted Monday by FBI Special Agent Brian A. Burns outlines the case against Pigeon. It details a long process by which prosecutors contend Pigeon unsuccessfully sought the contribution to the Feb. 26, 2014, event in Manhattan.

State campaign finance records indicate a host of star-studded donations to the Cuomo campaign on Feb. 26 of that year, including from movie director Steven Spielberg; his wife, actress Kate Capshaw; and former Walt Disney chief Jeffrey Katzenberg. Records show they all gave $25,000 on the date of the dinner, but it is not known whether they attended the event or may have agreed to contribute during Cuomo’s Hollywood fundraising trip a week earlier.

But one name also appearing as a $25,000 contributor on that date is Marlon Goldstein of Hollywood, Fla. According to a January 2014 press release, Goldstein was hired by Montreal-based Amaya Gaming Group as general counsel by CEO David Baazov – the Canadian whose alleged effort to contribute to Cuomo is now in question.

And in 2015, Reuters reported Amaya sold an Atlanta-based gambling equipment company called Cadillac Jack for approximately $476 million (Canadian). The federal complaint unsealed on Monday also refers to the $476 million sale at the same time.

The papers also refer to “Person B” being hired by “Person A” as executive vice president of corporate development and general counsel for “Company A,” corresponding to a press release at the same time announcing Baazov’s hiring of Goldstein.

Neither Amaya nor Baazov, its CEO, are listed as donors to any New York political campaign in the past 10 years. State records in Albany also do not show Pigeon as ever having represented Amaya as a lobbyist. At the time of the fundraiser, Amaya was represented in Albany by the politically wired lobbying firm Bolton-St. Johns.

Records at the Joint Commission on Public Integrity do not list any specific topics the firm was eyeing in 2014.

But online gambling companies have been trying for several years to get games like internet poker wagering legalized in New York. In 2015, the company’s Albany lobbyists were Greenberg Traurig and Niagara Frontier Business Solutions, a Buffalo firm that included Jack O’Donnell, a longtime Pigeon associate. Its topic of interest in 2015 was listed as gambling, records show.

The federal complaint unsealed on Monday by John Keller of the Department of Justice and Assistant U.S. Attorney Paul Bonnano does not name Cuomo, any companies or any associated individuals by name. But it does refer to Goldstein’s contribution of $25,000 in February 2014. The complaint also outlines a series of emails between Pigeon and others as they attempt to find a way to obtain the donation from the Canadian businessman, whom Pigeon referred to in his interview with The News as Baazov. Throughout the emails, Pigeon noted the laws prohibiting donations by foreign nationals or corporations that blocked initial efforts to obtain the contributions.

On Feb. 14, 2014, the FBI quotes emails listing a communication from the “managing director” of the campaign, on Monday identified by Pigeon and Cambria as Cuomo’s:

“We got a wire from [Person A] Is he an American citizen?” Pigeon responded: “No. They do have a guy at [Company B] who is perm resident and donates yearly Based in Atlanta.”

The federal papers list the $25,000 donation from Person B to the Manhattan event, while state campaign finance records indicate Goldstein made a $25,000 contribution. The complaint also says that after consulting with a lawyer, Person B directed those at the involved company not to process his request for reimbursement for the $25,000 donation. Person B then followed with an email: “Guys, As discussed, please do not process a reimbursement for the $25k contribution I personally made to the ... campaign.”

Then, during an April 5, 2017, interview concurrent with the time The News reported that federal subpoenas were hitting the streets, the complaint says Person B admitted he sent the preceding email only after making the donation and fully expecting to be reimbursed, “and only because he had consulted with an attorney based on his uneasiness with the entire transaction.”

Gambling bill up for review

Online poker gambling is still an issue in Albany. A bill to legalizing the form of gambling is set to go before a Senate Finance Committee meeting on Tuesday.

During Senate debate on last year’s effort to legalize the online gambling, Amaya's name made it into the back-and-forth between lawmakers. Sen. Liz Krueger, a Manhattan Democrat, noted that a “bad actor” clause – considered in other states’ online poker bills – had been dropped from a measure that hit the Senate floor last June.

She noted that New York “wouldn’t have the authority to say 'and you cannot go into business with,' for example, Amaya, a company which is facing serious charges from the Quebec securities regulators at this time.” She noted the bill under consideration – which died in the Assembly – did not ensure that the state could block 11 proposed licensed casino poker companies “from going into business with bad actors.”

Meanwhile, the Toronto Globe and Mail reported in February that Baazov will face trial this November as lawyers from Quebec’s securities regulator prepare to lay out their case in the largest insider trading investigation in Canadian history. He is accused of aiding with trades while in possession of privileged information, influencing or attempting to influence the market price of Amaya securities and communicating privileged information.

On Monday, Pigeon was released in lieu of $10,000 bond and other restrictions. He is slated to return to court on May 15 to determine if a preliminary hearing will be held.

Pigeon was arraigned three weeks ago on charges alleging he illegally funded a race for Amherst supervisor and two Erie County Legislature candidates through a committee known as the WNY Progressive Caucus.

He also has been indicted on charges he bribed State Supreme Court Judge John Michalek, who pleaded guilty and resigned his seat on the bench.